“SoftBank’s strategy for India includes solar panel manufacturing,” Manoj Kohli, executive chairman of SB Energy said in an interview in New Delhi. He ruled out making the panels through the company’s existing joint venture, formed last year with Foxconn Technology Group and Bharti Enterprises Pvt. to generate about 20 gigawatts of solar power.

While Modi seeks 100 gigawatts of solar capacity by 2022 — a target second only to China — the country’s manufacturers will need to ramp-up production in order to tap into the growth. Only about 40 percent of India’s 1.2 gigawatts of annual solar-cell manufacturing capacity is operational, according to estimates by Bridge to India. Module manufacturing capacity is about 5.6 gigawatts, of which 60 percent capacity is operational.

“To build large-scale manufacturing efficiency matching Chinese economics of scale will require government support,” Kohli said. he described Indian support policies in an “evolution stage.”

SB Energy could finalize a new joint venture once the Indian government introduces a made-in-India policy for panel manufacturing, according to Kohli.

Solar Imports

Most of India current solar-panel demand is satisfied through imports. In the first half of the year, the country was the second biggest importer of Chinese photovoltaic cells and modules, procuring almost 3 gigawatts, according to data from Bloomberg New Energy Finance.

Kohli, the ex-managing director at Bharti Enterprises Pvt., said that India could also play a role in the manufacture of power-storage solutions. Once prices near the rupee a kilowatt-hour level, Indian companies could be primed to compete.

“It will take three more years when storage will reach the affordability that India needs,” Kohli said. Government policies encouraging local production could make India one of the biggest storage manufacturers, he said.

SB Energy’s existing joint venture is currently concentrating on the development of 350 megawatts capacity in the south Indian state of Andhra Pradesh, Kohil said. The $400 million project may be commissioned by March 2017.

“Financing for our India solar portfolio will come from a mix of Japanese, international and Indian lenders,” Kohli said.